Community Development
Cost of Services Study
City of Redondo Beach
March 17, 2026
ABOUT RCS
Revenue & Cost Specialists founded in 1980
Pioneered matching Fee Revenues with Cost of the Services.
Studied over 250 agencies in 5 states
Eric Johnson, President
36 years with RCS. Assisted over 150 agencies
2 WHAT IS A COST STUDY?
Department Budget
Business Orientation
(2) Identified Cost of Services to Customers
(3) Matched Revenues to Costs
3 Conditional Use Permit
Design Review
Tentative Parcel Map
Zoning Compliance Report
Building Plan Check
Building Permit
THOROUGH PROCESS
4 VOTER-ENACTED PROPOSITIONS
Proposition 4 (1979)
• Defined service fees as being limited to the full costs of providing the service. • Rents and fines are exempted from cost recovery limitations.
Proposition 218 (1996)
• Placed limits on the creation and updates of property-related fees.
Proposition 26 (2010)
• Codified existing fee-setting practices as Article XIIIC of the State Constitution.
• Fees must be for a service directly benefitting the
fee payor.
5 Establish service
& time spent
Review budget
and calculate
overhead
Determine
Community vs
Personal Choice
Cost recovery &
Recommendations
METHODOLOGY
6 TAX vs FEE
Personal Choice
(Fee) Services
• Typically benefits community
as a whole
• 100% supported by tax dollars
E.g. police, fire, street
maintenance, park maintenance
and code enforcement
• The Customer is identifiable
and the Service is measurable
• Benefits an individual or group
• Subsidy levels may be based on
social, safety or welfare reasons
• E.g. Development Services
Community Support
(Tax) Services
7 Taxes
(General
Fund)
Community
Supported
Services
REVENUES
COSTS
Fees &
Charges
Personal
Choice
Services
FULL COST OF FEE SERVICES
8 Taxes pay for
Community Support Services
• User cannot select the service
• Service benefits community
as a whole
• 100% supported by tax
dollars
E.g. Patrol, Fire, street
maintenance, park
maintenance, code
enforcement
Fees pay for
Personal Choice Services
• User is identifiable
• Service is measurable
• Benefits an individual or
group
• E.g. Development
permit/inspection
Taxes
(General
Fund)
Community
Supported
Services
REVENUES
COSTS
Fees &
Charges
Personal
Choice
Services
9 FULL COST OF FEE SERVICES
TOTAL TOTAL TOTAL POSSIBLE
FEE SERVICE PROFIT/ NEW
SERVICE REVENUE COST (SUBSIDY) ACTUAL SUGGEST REVENUE
PLANNING SERVICES $489,514 $1,046,918 ($557,404) 46.8% 100.0% $536,000 BUILDING & SAFETY SERVICES $3,214,452 $3,875,459 ($661,007) 82.9% 100.0% $661,000 ALL FEE SERVICES $3,703,966 $4,922,377 ($1,218,411) 75.2% $1,197,000 PCT. RECOVERY
FROM FEES
THE REPORT
10 SUMMARY SCHEDULE
Schedule of fiscal impact by each fee 11
TOTAL TOTAL TOTAL POSSIBLE
FEE SERVICE PROFIT/ NEW
REF # SERVICE REVENUE COST (SUBSIDY) ACTUAL SUGGEST REVENUE (1) (2) (3) (4) (5) (6) (7) (8)
S-001 MINOR ADMIN DESIGN REVIEW $97,995 $132,237 ($34,242) 74.1% 100% $34,200 S-002 MAJOR ADMIN DESIGN REVIEW $108,528 $88,410 $20,118 122.8% 100% ($20,100) S-003 OTHER MINOR DESIGN REVIEW $31,740 $39,841 ($8,101) 79.7% 100% $8,100 S-004 OVERLAP PARKING REVIEW $2,290 $2,032 $258 112.7% 100% ($300) S-005 ADDITIONS PLANNING COM DESIGN REV $3,215 $5,791 ($2,576) 55.5% 100% $2,600 S-006 NEW CON NON-RES PLAN COM DESIGN REV $41,915 $31,032 $10,883 135.1% 100% ($10,900) S-007 NEW CON MFR PLAN COM DESIGN REV $6,430 $31,253 ($24,823) 20.6% 100% $24,800 S-008 NON-RES CONDITIONAL USE PERMIT $57,744 $134,533 ($76,789) 42.9% 100% $76,800 S-009 MULTI-FAMILY CONDITIONAL USE PERMIT $0 $0 $0 0.0% 100% $0 (c) S-010 CONDOMINIUM CONVERSION $16,558 $7,474 $9,084 221.5% 100% $0 (a) S-011 DEVELOPMENT AGREEMENT $0 $0 $0 0.0% 100% $0
S-012 ZONE CHANGE $0 $0 $0 0.0% 100% $0 (b)
S-013 GENERAL PLAN AMENDMENT $0 $0 $0 0.0% 100% $0 (b)
S-014 NEW SPECIFIC PLAN $0 $0 $0 0.0% 100% $0 (b)
PCT. RECOVERY
FROM FEES
APPENDIX A –
CURRENT & PROPOSED FEES
12 APPENDIX B –
REVENUE & COST SUMMARY W/ COST DETAIL WORKSHEETS
13 APPENDIX C –
DETAIL OF BUILDING & SAFETY FEES
14 FINAL TAX SUBSIDY DECISION
The Project Goal is to identify the full costs
for the various services
RCS and City Staff have made fee
recommendations for every service
City Council decides which services should
be charged the full costs and which services
are subsidized with tax dollars
History of 500 N Gertruda
16 • Resident petition submitted in late 2022
• Study conducted in 2023, RBMC thresholds met during midday weekdays only
• PWSC approved PPZ on 8/28/2023 subject to Coastal approval and recommended business outreach
• Council approved PPZ resolution on 12/19/2023 subject to Coastal Development Permit
• PPZ hours: Residents only Monday-Friday, 8am – 6pm
• Coastal Zone is any area west of PCH
Fee Reductions
17 Permit Type Current Fee Proposed Fee Proposed Fee
50% Reduction
Non-Res CUP $3,208 $7,305 $3,650
Variance $3,200 $7,950 $3,975
Pre-App Review $695 $2,515 $1,257
Entertainment Permit $806 $3,375 $1,687
Historic Variance $2,570 $7,950 $3,975
PC Appeal $550 $4,470 $2,235
CC Appeal $500 $5,620 $2,810
Anticipated Revenue
18 • Past few years average revenue $4.1 million
• Expenses reach $4.9 million
• Proposed fee update would net approximately $1
million or more in annual revenue
• Closes the gap between revenue and expenses
• Support expenses associated with enhanced
service delivery
Development Impact Fees
19 Current Fees
• Park in-Lieu Fees (Quimby Fees) - $25,000 per new
subdivided residential unit
• Public Art Fee - 1% of project valuation (for valuations over $250,000) for commercial, mixed-use and multifamily of 4+ units • Parks and Recreation Fee - $430 flat to any new singlefamily residential Consider updating agreement with RCS to evaluate
adding new impact fees
Recommendations
20 • Receive and file report;
• Provide direction on feed study and proposed fee
updates; and
• Provide direction on agreement for impact fee
study.
Building Fees Existing/Proposed
21 Permit Type Current Fee Proposed Fee Difference
Water Heater Replacement $91.60 $151.91 $60.31
Residential Reroof Permit $394.92 $659.53 $264.61
Grading for New
Construction
$1,029.82 $644.10 -$385.72
Shoring for New
Construction
$1,663.74 $2,131.87 $468.13
New Single-Family
Residence
$35,680.38 $41,122.50 $5,442.12
New Multifamily 3-unit $46,125.17 $53,483.38 $7,358.21
Electrical Panel Upgrade $122.13 $147.78 $25.65
Single-Family Addition $5,692.86 $14,459.05 $8,766.19
Commercial Tenant
Improvement
$6,782.04 $12,887.58 $6,105.54
22 Permit Type Current Fee Proposed Fee
Minor Admin
DR
Single Family, Additions, Commercial
Remodels, Signs, etc. - No
Charge
Pre-Application - $695 per application
Residential Addition - $825 per application
Commercial Tenant Improvement - $825 per
app
Standalone Sign Program - $825 per app
New Single-Family Residence - $1,930 per
app
Major Admin
DR
New containing 2-3 units on a lot - $2,360
per app + $688 per unit
Multi-Family Residential - $2,360 per app
+ $688 per unit
Non-Residential under 10,000 square foot
floor area - $5,400
Non-Residential (under 10,000 sf) - $3,580
Residential Base (up to 4 Units) - $3,580 per
app
Each additional unit over 4 (up to 15) - $175
Non-Res
Commercial
DR
Non-Residential under 10,000 square foot
floor area - $3,215
Non-Residential 10,000-49,999 square
foot floor area - $12,900
Non-Residential 50,000 square foot or
more floor area - $25,800
0-9,999 square foot of floor area - $7,305
10,000-49,999 square foot of floor area -
$9,235
50,000+ square foot of floor area - $13,795
Non-Res
CUP
$3,208 $7,305
Variance $3,200 $7,950
Res
Modification
$920 $2,165